GM Launches Next Step in Build-to-Order Strategy

SAN MATEO (05/16/2000) - General Motors Corp. took another step on Tuesday to add more clicks to its bricks by partnering with Reynolds and Reynolds Co. to integrate GM's Buypower consumer auto selection site with dealers' online and off-line sales efforts.

Reynolds and Reynolds is currently the leading provider of retail processing systems to automotive dealers. The relationship between GM and Reynolds goes back 70 years to 1927 when Reynolds created for GM its first standard accounting forms, officials said.

The announcement with GM will tighten that relationship. GM will take a 10 percent equity stake in Reynolds and Reynolds. Reynolds and Reynolds will become a "preferred" provider of systems to GM's 8,000 plus dealers.

The multi-year effort will eventually connect many disparate systems such as service reports, financing, buyer preferences, and inventory that often require dealers to have multiple PCs and multiple connections, officials said.

In the car-buying process there are about 13 major steps that occur at 125 touch points, noted Ralph Szygenda, chief information officer at GM. "There are major inefficiencies in that process," said Szygenda.

Once the GM-Reynolds deal is in place, dealers and manufacturers could see an aggregate savings of about $10 billion per year, said Szygenda.

The system when completed will also allow consumers to schedule test drives and service appointments online, with the longer term goal of allowing consumers to view the actual build-to-ship schedule for their new car.

"Once a buyer gets an order number, there will be a tracking system similar to what Federal Express Corp. does with package tracking, said Buzz Waterhouse, president of Reynolds.

The GM strategy is moving toward mass customization or build-to-order car-buying, according to one GM executive.

"This is a major step in the hybrid business-to-business to consumer solution," said Bill Lovejoy, GM group vice president for North America Vehicle Sales, Service and Marketing.

The system will also contain e-CRM (electronic customer relationship management), dealer referral, and supply chain integration. Plans call for it to be deployed as a hosted ASP (application service provider) model using XML as the standard for information exchange, according to Szygenda.

General Motors Corp., in Detroit, can be reached at www.gm.com. Reynolds and Reynolds Co., in Dayton, Ohio, is at www.reyrey.com.

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